Ashford W. Meikle, Staff Reporter
Bunting
Investment bankers Dehring, Bunting and Golding (DB&G) have dismissed concerns that a change in government could negatively affect the performance of the company, pointing instead to its technical expertise in brokering deals and its diversified income stream.
"A relatively minute portion of our revenues come from dealings with Government and, in fact, if anything, it has declined over the years so [any change in government] I would think, on balance, would have a negligible effect, said the company's executive chairman, Peter Bunting.
Perceived closeness
The DB&G boss was speaking on Wednesday at the company's annual general meeting which was held at its merchant bank offices on Holborn Road in New Kingston. He was responding to a question posed regarding the investment house's perceived closeness to the Minister of Finance, Dr. Omar Davies, and if a government formed by the JLP would result in DB&G losing out on government deals.
However, Bunting attempted to downplay his company's connections with the Government, saying that perceptions were unfounded and, idownplay his company's connections with the Government, saying that perceptions were unfounded and, in fact, had worked against DB&G.
"I personally would not want to give any credibility to respond to it. I really don't think it is material and I think to really address it would be giving too much importance to it ... "It's a perception. What most people don't realise is that many times because of 'connections' we have not got deals because public servants may have felt that they have to be very careful."
Served in public sector
Bunting, who was a Member of Parliament in the ruling PNP Government from 1997 to 2002, has served the public sector in a number of positions, including chairman of the National Water Commission, president of the National Investment Bank of Jamaica (NIBJ), as well as Parliamentary Secretary in the Ministry of Health.
But, he admitted to shareholders that DB&G "holds Government of Jamaica debt as every commercial bank and securities dealer, but which we buy in auctions as the same basis as the rest of the market."
For its financial year ending March 31, 2006, DB&G earned net profit of $882 million on revenues of $4.1 billion. While the company's gross revenue increased by just two per cent, its net profit climbed by 10 per cent. Its net revenue, which increased by 10 per cent, comprised principally of net interest income (42 per cent), securities trading (38 per cent), fees and other Income (13 per cent) and forex trading (seven per cent).
Lucrative government deals
The investment bankers have been quite successful over the years in bagging lucrative government deals. Notably, the following transactions come to mind:
In 2001 the company purchased Finsac's shares in Billy Craig Merchant Bank
In April 2002 they floated a $3.5 billion private bond to fund Highway 2000.
The stockbrokerage arm of DB&G won the tender from the National Investment Bank of Jamaica to sell the Government's 79.5 million shares in Radio Jamaica
In April 2004, the Government sold its $2.54 billion debt owed by AIC (Barbados) Limited to DB&G. Michael Lee-Chin's AIC had purchased the Government's 1.7 billion shares in National Commercial Bank.
Founding partner and board member, Mark Golding, also sought to discount the perception.
Opportunities
"From time to time, we have seen opportunities where we can bring a particular transaction to the Government, as a potential client, which fills a particular need at that point in time that we see. On occasions those transactions have been executed. People can say anything but the reason why those transactions are executed is because we saw the opportunity, we conceived a way to provide some particular solution which the client in that instance had a need for and neglected to proceed with."
Even DB&G's competitors have recognised the company's expertise. "As far as I am concerned, DB&G gets most of the Government deals because they are the best investment bank in Jamaica," the chairman of Mayberry Investments, Chris Berry, once said.
And, according to Golding, the company expects to snag more government deals.
"I believe, regardless of which government is in power, as long as there is a need for [restructuring deals] and as long as we continue to have a creative approach to what we do and have the intellectual capacity to deliver, that will continue.
